UK industrial output rose 0.5 pct in Dec., manufacturing contracts

Industrial production in the UK rose in December last year, mainly led by a sharp increase in the output of utilities.

The index of production in Britain increased by 0.5 percent in December month-on-month, the Office for National Statistics said on Thursday.

However, manufacturing output fell 0.1 percent, posting its first monthly fall since April 2010. Markets had expected manufacturing output to rise by 0.5 percent rise in the last month of 2010.

“December’s UK official industrial production figures suggest that, like the rest of the economy, the manufacturing recovery was blown of course by bad weather at the end of the year,” said Samuel Tombs, an economist with Capital Economics.

The rise in UK industrial output in December was largely led by a 6.1 percent increase in the output of electricity, gas and water supply industries. Production of consumer durables rose 5.2 percent.

“At least the figures are not sufficiently weak on their own to prompt a downward revision to quarterly GDP growth in Q4,” Tombs said.

Britain's gross domestic product (GDP) fell 0.5 percent in the fourth quarter last year, due to a slump in construction industry.

While the industrial production went up by 2 percent in 2010 compared with 2009, manufacturing output rose 3.6 percent.

“What’s more, surveys suggest that the industrial recovery gathered pace in January. Accordingly, output probably bounced back at the start of the year,” Tombs added.